Trump to Launch Multiple Collaborations with Venezuela

Summary

President Trump announced multiple upcoming collaborations with Venezuela, characterizing the relationship as “very good.” This follows recent statements confirming that US oil majors are actively drilling in the country and that he plans to visit.Zhitong

Impact Analysis

This is a complete 180 from the ‘maximum pressure’ era, but it’s classic Trump pragmatism: he’s trading ideology for barrels. By explicitly stating that US majors are drilling and Venezuela is getting paid, he’s effectively greenlighting the full return of Venezuelan heavy crude to the global market.

The signal here is inflation control. Trump needs lower gas prices, and Venezuelan heavy crude is the missing feedstock for US Gulf Coast refiners. The obvious trade is the US supermajors (like Chevron) with boots on the ground, but the smarter play is the complex refiners (Valero, Phillips 66) that have been margin-squeezed by the lack of heavy sour crude.

Also, don’t miss the geopolitical wedge—every barrel pumped by a US major is one less barrel securing Chinese debt. Bottom line: The sanctions risk premium is evaporating. I’d be looking to short the heavy-light crude spread and long the US operators getting first dibs on these reserves.